Organisation: a structure of interconnecting parts with a purpose.

Armed with a secure understanding of what values are and of the role they play in the life of individuals, we can now examine the nature and function of organisational values.

In this chapter we shall compare and contrast organisational values with individual values, discovering significant similarities – and one important difference – between them. We shall conclude by considering the expression of organisational values in a mission statement.

In the next chapter we shall start our examination of the six step process.

MAKING THE LINKS

Given the differences between individuals and organisations, why should the importance of individual values convince us of the importance of organisational values? Why should we think, for example, that organisations have values, or that they have the same nature or play the same role as the values of individuals?

RECOGNISING THE SIMILARITIES

Individuals and organisations are more alike than we might think. For example, organisations, like individuals:

• make decisions
• act freely and responsibly
• have legal and moral rights and duties
• make and enforce their own rules
• are attributed beliefs, desires and intentions
• flourish and decline according to their own undertakings
• form habits, virtues and vices
• form relationships
• are praised and blamed
• attract loyalty, pride, affection, anger, resentment and hate.

These characteristics cause philosopher Roger Scruton to argue that organisations are individuals, complete with ‘moral personalities’. And the law agrees with him. Organisations can be held legally to account in their own right (ie not in the person of any director or executive of the organisation) for such crimes as manslaughter, malpractice and negligence.

Not all organisations have all the features listed, nor do they have them in the same degree. And the law does not recognise every organisation as an individual. But to the degree that an organisation does have these features it has an identity – a ‘personality’ – of its own.

To what degree does your organisation possess these features? Does your organisation have an identity of its own? Could it? Should it?

Determining character

To the extent that we think of organisations as individuals, the values of an organisation should play a role precisely analogous to the role played by values in the life of an individual.

On this basis, an organisation’s values will determine:

• organisational goals (both intrinsic and instrumental)
• the principles that guide organisational policies and strategies
• the standards against which the organisation should be judged.

And on this model, the extent to which an organisation lives up to the right values will:

• underpin its self-respect (its morale)
• underpin others’ respect for it (its reputation)
• underpin its respect for others (eg employees, customers, shareholders, suppliers, its community).

The values of an organisation, it seems, together with its ability to live up to these values, determine the current and future character of the organisation: its identity as that organisation.

To get the values right, and to live up to them successfully, is to get the organisational culture and ethos right. And while such things are difficult to pin down, it is acknowledged by everyone that getting such things right makes a major contribution to organisational success. Just as individual happiness is dependent on an individual’s living up to their values, so the success of an organisation depends on its living up to its values.

RECOGNISING THE DIFFERENCES

So individuals and organisations are more similar than we might think. But clearly there are important differences, for example:

• organisations, unlike individuals, do not have subjective awareness
• organisations, unlike individuals, are composed of individuals and relationships between them.

The former mandates a small adjustment in our thinking about the role of organisational values. The latter has a major impact on the way values function in an organisation.

Striving for success

Human beings strive for happiness. They may differ in their awareness of this and in their beliefs about:

• what happiness is
• how to achieve happiness

but all strive to achieve it.

Yet it makes no sense to say that organisations strive for happiness because happiness involves a state of subjective awareness, something organisations lack.

The apparent disanalogy can be eliminated, however, if we think of individuals (including organisations) as striving for success in achieving their goals, particularly those goals – like happiness – that give life meaning.

The overall goals of organisations – intrinsic values – are those the achievement of which provides these organisations with their raison d’etre.

Schools, for example, exist to produce wisdom, businesses to create wealth, hospitals and charities to promote security, health and well-being. This does not mean that all schools (for example) understand wisdom in the same way, only that all strive to produce it.

Every organisation has a purpose that defines it, thereby:

• making it an organisation of a certain kind
• providing its rationale
• determining its instrumental goals.

If an organisation is failing to achieve its overall purpose then the point of its existence can be called into question.

In thinking of organisations, therefore, it is the notion of success (in achieving its goals), rather than that of happiness, that encapsulates that which is intrinsically valuable.

To tease out what organisational success is to you, you might like to make a ‘spider’ chart for it.

Your chart is likely to include things you believe to be an integral part of, and things you believe to be a means to, organisational success.

Understanding complexity

The second disanalogy between individuals and organisations is that organisations are composed of individuals, each with their own set of values and their own ability (or lack of it) to live up to them. An organisation, if it is large enough, might even be composed of individuals that are themselves organisations. And many organisations have within them departments that operate, or should operate, as if they were themselves individuals.

The complexity of organisational composition generates two types of value-conflict that have no parallel in the life of an individual. These are conflicts between the:

• differing values of constituent individuals (departments/organisations)
• values of the organisation itself and its constituent individuals.

The successful elimination or management of such conflicts is an integral part of organisational success. This ensures that the notion of shared values is of the utmost importance in the life of an organisation. Such a notion plays no part in the life of an individual. This is an extremely significant difference between individuals and organisations. It has a major impact on the role played by values in the life of an organisation.

Before we explore this impact let’s re-visit the notion of a value-conflict.

Re-visiting conflict

It is in the nature of values to conflict (see pages 26-27). Each quality valued (intrinsically or instrumentally) generates a goal, and each is a constraint on the pursuit of the others. In order to live up to all their values over time, individuals must exercise sound judgment and sustained effort to negotiate conflicts wisely.

Organisational values are equally susceptible to such conflict. A hospital, valuing both compassion and efficiency, or a business valuing profitability, health and safety, will each find that such values inevitably conflict.

Organisations, like individuals, must exercise sound judgment and sustained effort to maintain integrity by balancing their values over time.

Let’s now examine more closely the value-conflicts peculiar to organisations, those that underpin the importance of shared values.

Managing diversity

Every member of an organisation (let’s say) values organisational success (intrinsically or instrumentally). But this does not mean they will agree on what success is or how to achieve it.

Some such disagreements energise, stimulate creativity, and trigger productive debate. Others are energy-sapping and creativity-stifling, leading to time-wasting squabbles, misunderstandings and irritation. Consider, for example, the following two views of business:

• 1.Our purpose is to create wealth.
• 2.Our purpose is to use profits to enrich the human soul and alleviate suffering.

Differences of this kind (about which people can be quite moralistic) can undermine cohesion, making it difficult for people to work together. They arise, furthermore, in every sector. In education, for example, a debate rages about the extent to which schools should extend their remit from the academic to the personal and social aspects of life. In health the balance between prevention and cure has to be negotiated carefully.

It is easy, of course, to reconcile the two views above:

• Only wealth creation yields profits with which to ‘enrich the human soul and alleviate suffering’.
• The best way to create wealth is effectively to market a product or service that ‘enriches souls’ and/or alleviates suffering.

But if the two views are operating implicitly the need for reconciliation can go unnoticed. And if different people are pulling in different directions this will inevitably undermine organisational integrity.

It is not only unrecognised disagreements about what success is that causes problems. Disagreements about how to achieve success also generate distress, especially when unrecognised.

Such distress can usually be eliminated through creative reconciliation if the disagreements that trigger it are brought into the open.

Minimising conflict

Conflicts between the values of organisations and their constituent individuals can also be a source of organisational ill-health. This can occur when:

• The values of organisations and individuals are incompatible.
• The organisation (and/or an individual) is failing to live up to its values.

Minimising incompatibility

Organisational cohesion is determined by the degree of compatibility between its values and those of the individuals who belong to it.

Most people understand this. Organisations, in recruiting, usually make some attempt to outline the values of the organisation and ensure that the values of prospective employees are compatible. Similarly, jobseekers usually apply to organisations whose values are roughly in line with their own.

But attempts to secure value-compatibility are not always successful. (Nor, depending on the market for jobs/labour, are they always made.) The result can be a clash of values that will benefit neither employee or employer.

Such clashes can occur without anyone embracing the wrong values, or failing to live up to their values. Their source lies often in differences of opinion about how to manage conflicts of value. One of the most common disagreements of this kind consists in an organisation’s expecting to come first in the life of an individual when the individual puts family, community or social life first.

Walking the talk

Sometimes value conflicts occur not because of value-incompatibility but because an organisation or individual is failing to live up to their stated (or implied) values.

As we have seen (pages 17-25) we have reasons for having the values we (claim to) have, they are not just personal preferences. For this reason values command our respect and we universalise them, judging others as well as ourselves by their standards, holding everyone to the principles they generate.

Everyone, therefore, has reason to pay lip service to such values even if they have no intention of living up to them.

The frequency with which people and organisations fail to ‘walk their talk’ is often behind the cynicism about mission statements, after all no mission statement would ever read:

We intend to get everything we possibly can from our employees and customers whilst giving as little as possible in return.

Such a mission statement would not be praised for honesty, it would be condemned for stupidity. Yet sadly many people, if asked about the values that lie behind the actual practice of certain organisations, would express them thus.

Mismatches between what is said and what is done often go undiscovered in the first stages of a relationship. Those who don’t uphold their stated values do everything they can to hide this (sometimes even from themselves) including offering plausible explanations for violations, or denying them entirely. And those who do uphold their values tend to assume that everyone is as trustworthy as themselves.

Violations of the principles and standards generated by our values rarely go unnoticed for long, however, because they

nearly always cause damage. Once noticed the lack of trust engendered will itself threaten relationships.

Individuals and organisations who do not walk their talk are not always doing wrong intentionally. They might simply be ignorant, unaware of the relationship between values, principles, standards and their self-respect and reputation. Or they might just be weak, always intending to do better, but never actually implementing the strategies needed to help them resist temptation.

Whatever the reason, though, for an organisation’s (or an individual’s) failing to walk their talk it will lead to disillusionment and relationship breakdown. The honest sales executive will not be happy if he is expected to lie about delivery dates to reach his sales targets. The compassionate doctor will not thrive if she is expected to reduce waiting lists by short-changing patients. Gifted teachers will wilt if appraised solely in terms of exam results.

Yet it is precisely these people who, by virtue of their values, are most likely to help their organisations achieve the goals these organisations represent themselves as having.

And it is not just the employer/employee relationship that can be undermined by value-incompatibility. Customers will get angry if an organisation fails to deliver on its promises, as will shareholders, suppliers and the community. Value clashes can haunt every kind of organisation.

The possibility of such clashes can be minimised by an organisation’s taking active and self-conscious steps to avoid them.

CHANGING ORGANISATIONAL CULTURE

Value incompatibilities and clashes can and often do follow from a change in organisational character. Sometimes indeed an organisation will intentionally trigger such value clashes in order to bring about a change in organisational culture.

The appointment of a new chief executive or manager with a different style of leadership, for example, is highly likely to result in value incompatibilities and conflicts. For this very reason it is an excellent way of shaking up an organisation that is failing to live up to its mission, has low morale and/or a bad reputation.

For this reason too it is something to be managed very carefully if the organisation is successfully living up to its mission, has high morale and a good reputation.

Character changes will inevitably lead to a period of instability and discomfort for the organisation. For good or ill there will be resignations and early retirements as those who cannot live with the new values vote with their feet. Sometimes, if the established culture of the organisation is strong enough (or the backing of directors/governors sufficiently weak), it will be the new management that goes. There will almost certainly be dismissals.

This discomfort and instability will continue unless and until a new organisational identity emerges.

Organisational identity, however, as we have seen, is determined by organisational values. It depends on the existence of a set of core values to which everyone in the organisation, consciously or unconsciously, subscribes.

It is the organisation’s core values, and/or its ability to live up to them, that must be changed (if what is needed is a change of culture) or that must be maintained (if what is needed is a continuation of/ culture).

Either way organisational success is determined to a great extent by the organisation’s having a set of core values, and by the extent to which those values inform the behaviour of everyone in the organisation.

QUESTIONS AND ANSWERS

Value conflicts are ubiquitous. why should we believe that there are any shared values?

There is excellent evidence for the existence of shared values. In 1996 the National Forum for Values in Education and the Community, consisting of 150 people from across society, drafted a statement of the values on which they agreed. MORI showed this to 3,200 schools, 700 national organisations, did an omnibus poll of 1,500 adults, and held focus groups of governors, headteachers and parents. 85-97% of respondents agreed with the values outlined and said they would be happy to see them taught in schools. Other sectors (health, business, the civil service) are also discovering such shared values.

If there are shared values why are there so many disagreements about values?

The existence of core values does not detract from the existence of unshared values. Also agreement on values does not ensure agreement on interpretation (what is truth?), ordering (I might put freedom before equality, you put equality before freedom), source (you believe it is God, I believe it is human nature), or application (you believe that respecting people means abortion is permissible, I believe it means abortion is impermissible). It is in reflecting on and discussing these disagreements that we discover how to live up to the values we share.

Why are disagreements about values so threatening?

Our values matter to us. Disagreements are evidence for error (on one side or both) and the behaviour to which such errors lead is nearly always damaging.

THE VALUES OF ORGANISATIONS: A SUMMARY

Organisations can be seen as individuals with ‘moral personalities’. The organisational mission statement is a vivid expression of this personality in making explicit the organisation’s beliefs about the:

• Values or goals that matter to the organisation, both as valuable in themselves and as a means of achieving that which is valuable in itself.
• Principles that inform the policies and strategies by which the organisation will achieve their goals.
• Standards against which the organisation will judge itself and is prepared to be judged by others.

Although both organisations and individuals value success, whatever that might mean to them, organisations are constituted of many different individuals. This complexity ensures that there will be many different views about:

• the nature of organisational success
• the means to organisational success.

Organisations can turn such differences to the organisation’s advantage by:

• explicitly identifying its core values
• ensuring that its core values inform every aspect of its behaviour
• making use of these core values to ensure that individual differences stimulate energising and creative debate.

The six step process described over the next six chapters will help you to harness the creative energy of your people in the clarification of your organisation’s values.

DISCUSSION POINTS

• 1.Some people think that in a pluralist society such as our own there cannot be shared values. What do you think?
• 2.Some successful organisations never discuss their core values. Do you think this means they don’t have them?
• 3.Some people claim to be able to tell ‘at a glance’ whether or not someone is trustworthy. Do you think this is possible?